When catastrophe strikes — whether it’s a hurricane, wildfire, or flood — policyholders need more than just financial support. They need speed, clarity, and compassion.
In the crucial hours and days following a disaster, how insurers handle claim payouts can make or break customer trust — not to mention, leave policyholders in vulnerable, even dangerous, circumstances.
Here are three key reasons why digital payouts for insurance claims have become essential.
3 Reasons to Offer Digital Payouts for Insurance Claims
1. Speed is Everything in a Crisis
According to the National Centers for Environmental Information, billion-dollar weather and climate disasters are increasing in frequency and severity. When policyholders are displaced or dealing with urgent repairs, waiting days or weeks for a paper check simply isn’t acceptable.
Traditional claims processes — reliant on mail delivery, bank lags, and manual workflows — can leave policyholders stranded. If someone is unhoused, even figuring out where to send a check becomes a challenge. These delays can prevent access to temporary housing, transportation, food, or emergency services.
Digital disbursement platforms allow insurers to send funds instantly via push to debit, digital wallets (like PayPal, Venmo, Apple Pay), or direct deposit. This speed helps carriers fulfill their promise and show up when it matters most.
2. Transparency Builds Trust
In moments of crisis, communication is just as important as compensation. In fact, a 2025 survey found that American policyholders feel communication is the most important aspect of the claims process, closely followed by speed, ease of use, and transparency.
Unfortunately, that same survey found that nearly 30% of policyholders felt communication around a recent claims payout was lacking. That’s a significant trust gap.
Digital disbursement tools don’t just deliver funds faster — they also keep claimants informed. Personalized notifications and real-time status updates give policyholders a sense of control during uncertain times. This transparency helps reduce frustration and strengthens the relationship between carrier and customer.
3. Efficiency Drives Loyalty (and Growth)
Digital disbursements don’t just benefit policyholders — they streamline operations for insurers, too. Moving away from paper checks reduces costs, minimizes errors, and lowers fraud risk. It also frees up internal teams to focus on higher-value work.
Beyond claims, digital disbursement solutions can support:
- Agent retention through real-time commission payments
- Premium refunds delivered securely and quickly
- Self-service options for binder payments and collections
- Multi-party payments with built-in status visibility and e-signature workflows
To maintain goodwill all around, it’s important to provide stellar experiences outside of the claims payout process. Billing and payments solutions that are designed to elevate the entire policyholders experience will offer end-to-end payment processing. From the disbursement side of things — bulk payments, vendor network matching, and lienholder payment solutions — to encouraging timely premium payments and encouraging policy retention.
Next Steps to Becoming the Hero
In the wake of catastrophe, insurers have a rare opportunity to be more than just a financial resource — they can be a lifeline. By embracing digital disbursement solutions, carriers can deliver faster, more transparent, and more empathetic service when it matters most.
Ready to be the hero your policyholders remember? Get your copy of our ebook, Be the Hero: How Insurers Can Respond Faster After Catastrophes, to get:
- New research on policyholder preferences for receiving claims payments
- A step-by-step guide to starting your hero’s journey
- And more!
